Blue-Sky Laws Exist in Order To

question 94

Multiple Choice

Blue-sky laws exist in order to:

• A) protect stock underwriters from fraudulent firms.
• B) restrict the amount of profit from IPOs.
• C) control the amount of stock owned by one investor.
• D) protect investors from deceptive firms.

---

Definitions:

Variable Cost

Costs that vary directly with the level of production or sales, such as materials and labor.

Rate of Return

The profit or deficit incurred on an investment during a certain period, shown as a percentage of the original investment amount.

Target Cost

The maximum amount that can be spent on a product to ensure a desired profit margin is achieved.

Market Dictated Price

The price of a good or service as determined by the supply and demand dynamics in the open market.